Velo3D Soars 35% on Aerospace Breakthrough: Is This the Catalyst for a New Bull Run?

Summary
• Velo3D (VELO) surges 35.2% intraday, hitting a 52-week high of $9.25
• After-hours trading saw a 16.5% jump following Mears Machine’s aerospace delivery using Velo3D’s technology
• CEO of Mears Machine highlights 'growth prospects exceeding current capacity' and praises Velo3D’s role in precision manufacturing

Velo3D’s stock has erupted in a historic intraday rally, driven by a pivotal aerospace hardware delivery by Mears Machine Corporation. The stock’s 35.2% surge—its largest single-day gain in over a year—has thrust it to a 52-week high of $9.25, fueled by a strategic milestone in additive manufacturing. With the defense and aerospace sectors accelerating their adoption of advanced manufacturing solutions, investors are now scrutinizing whether this move marks the start of a sustained breakout for the underdog tech stock.

Aerospace Hardware Delivery Ignites Velo3D's Surge
Velo3D’s meteoric rise stems from Mears Machine Corporation’s successful delivery of a complete aerospace gas turbine hardware set to a new customer, leveraging Velo3D’s Sapphire XC additive manufacturing system. The components, including Haynes 282 and Inconel 718 parts, underwent specialized hot isostatic pressing and heat treatment for high-speed rotating applications. Mears Machine’s CEO emphasized that growth prospects 'significantly exceed existing print capacity,' directly attributing the milestone to Velo3D’s technology. This validation of the company’s additive manufacturing capabilities in mission-critical aerospace applications has triggered a surge in investor confidence, particularly as the defense sector’s $1.7 trillion budget prioritizes AM solutions.

Industrial Machinery Sector Gains Momentum as Velo3D Leads Innovation
The industrial machinery sector has seen mixed performance, with Boeing’s acquisition of Spirit AeroSystems and U.S. Steel’s resumption of production in Illinois highlighting broader sectoral shifts. However, Velo3D’s 35.2% gain far outpaces peers like 3D Systems (DDD), which rose 2.54% intraday. The sector’s focus on additive manufacturing and supply chain resilience aligns with Velo3D’s strategic partnerships, particularly in defense and space. As the U.S. military accelerates modernization efforts, Velo3D’s vertically integrated solutions position it to capture a disproportionate share of the $5.4 billion AM market by 2030.

Options and ETFs to Capitalize on Velo3D’s Bullish Momentum
• MACD: 0.305 (bullish divergence), Signal Line: 0.153, Histogram: 0.152 (positive momentum)
• RSI: 70.5 (overbought but trending)
• Bollinger Bands: Upper $6.60 (current price $8.91 above), Middle $5.24, Lower $3.87
• 200D MA: $4.53 (far below current price)

Velo3D’s technicals scream short-term bullishness, with RSI at 70.5 and MACD divergence suggesting continued upside. The stock is trading 62.5% above its 200-day moving average, a strong indicator of momentum. For options, the VELO20260116P7.5 put option stands out: strike price: $7.50, expiration: 2026-01-16, IV: 29.1%, leverage ratio: 1819%, delta: -0.016, theta: -0.00028, gamma: 0.0466. While the delta is low, the high leverage and gamma suggest potential for volatility-driven gains if the stock consolidates. A 5% upside scenario (to $9.35) would render the put worthless, but the high gamma implies sensitivity to price swings. Aggressive bulls may consider this contract for a volatility play, though liquidity is limited (zero turnover).

VELO20260116P7.5 is the sole viable option in the chain, offering a high leverage ratio and moderate IV. Its low delta (-0.016) indicates minimal directional risk, while the high gamma (0.0466) suggests potential for rapid value changes if the stock experiences sharp moves. This contract is ideal for traders betting on continued volatility in Velo3D’s price action, particularly as the stock approaches its 52-week high. However, the lack of volume and turnover means execution risks remain.

Backtest Velo3D Stock Performance
The backtest of VELO's performance after a 35% intraday increase from 2022 to now shows favorable results. The 3-Day win rate is 58.33%, the 10-Day win rate is 63.89%, and the 30-Day win rate is 86.11%, indicating a high probability of positive returns in the short term. The maximum return during the backtest was 44.81% over 30 days, suggesting that VELO can deliver significant gains even after such a substantial intraday surge.

Velo3D's Aerospace Momentum: Time to Ride the Wave or Wait for Confirmation?
Velo3D’s 35.2% intraday surge is a watershed moment for a stock that has long been undervalued despite its technological edge in additive manufacturing. The aerospace and defense sectors’ growing reliance on AM solutions, coupled with Velo3D’s strategic partnerships and EBITDA improvement, suggest this rally could be the start of a larger trend. Investors should monitor key levels: a break above $9.25 (52-week high) could trigger a retest of the $10.00 psychological barrier, while a pullback to the $7.50 strike price would test the put option’s viability. With the sector leader DDD up 2.54% and the broader industrial machinery sector gaining traction, now is the time to act. For those seeking leverage, the VELO20260116P7.5 offers a high-risk, high-reward play on volatility. Aggressive bulls should watch for a breakout above $9.25—failure to hold this level could signal a consolidation phase.